SBD/February 15, 2011/Marketing and Sponsorship

NFL Gives Electronic Arts A Break On Licensing, Sponsorship Contract

Electronic Arts' contract with the NFL now runs through '13
The NFL "has restructured its lucrative licensing and sponsorship contract with Electronic Arts to account for the sport's uncertain future, significantly reducing the video game maker's contractual obligations next season but adding a year to the deal," according to sources cited by Daniel Kaplan of SPORTSBUSINESS JOURNAL. The contract now runs through '13. The league is "believed to have so far rebuffed pleas for fee reductions from other licensees and sponsors, many of which, like EA, find it difficult planning for the next season under the threat of a work stoppage." However, EA is a "special case, with its iconic 'Madden' video game title." The licensing deal it agreed to with the NFL in early '08 is "believed to be worth well into nine figures in guarantees and royalties over its original five-year term." Jaguars Owner Wayne Weaver, who serves as Chair of the NFL's Business Ventures Committee, said, "For one of our core partners in a difficult environment, we say let's look at this, and maybe it makes some sense to extend something out longer and give our partner some relief in the short term but gain something on the back end." Both Weaver and the sources "declined to say how much relief EA is gaining" (SPORTSBUSINESS JOURNAL, 2/14 issue).
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